2024 CPEO: The Beacon of China's Health Industry, Navigating Challenges Toward Incremental Growth

Amid continuous shifts in the global economy, China’s health industry is facing unprecedented challenges and opportunities. At this critical juncture, the highly anticipated 17th Health Industry (International) Eco-Conference—2024 Xipu Conference will grandly open in Boao, Hainan, from August 9 to 14. The theme of this year’s conference, “Moving Forward Under Pressure: Breaking Through and Establishing New Paths from Existing Stock to Incremental Growth,” not only highlights the current predicaments of the industry but also charts its future direction, expected to exert a profound impact on China’s health industry.

Since March 28, when the official organizers of the Westphal Conference publicly announced the theme “Moving Forward Under Pressure: Breaking and Establishing the Path from Stock to Incremental Growth,” it has garnered widespread attention and resonance within the industry.

According to statistical data from relevant authorities, in 2023, the value-added of China’s pharmaceutical industry above designated size decreased by 5.2% year-on-year, operating revenue declined by 4% year-on-year, and profits dropped by 16.2% year-on-year. The pharmaceutical industry is facing unprecedented development pressures.

According to data from Zhongkang Technology’s CMH terminal market monitoring, the total size of the pharmaceutical terminal market in 2023 reached RMB 2.0149 trillion, a year-on-year increase of 5.3%. Growth was primarily driven by tiered hospitals, primary healthcare institutions, and e-commerce platforms, whereas the growth rate of the pharmacy terminal pharmaceutical market was merely 1.1%. With medical insurance payments dominating the landscape, the ceiling for the existing market—focused on meeting basic medical and medication needs—has become clearly visible, intensifying competitive pressures.

However, against the backdrop of profound population aging, technological innovation, and national development transformation, China’s health industry is simultaneously poised for substantial incremental growth.

First, there remains a substantial amount of unmet clinical demand in the Chinese market, which needs to be addressed through technological innovation and product upgrades. Meanwhile, China has surpassed the development stage of USD 10,000 per capita GDP, where basic subsistence consumption is no longer the focus; instead, consumption aimed at development and improvement is on the rise. The emergence of "self-pleasing consumption" will bring new opportunities to the health industry. Additionally, China is rapidly entering a phase of deep aging, which will generate enormous demand for silver economy healthcare.

On one hand, massive health demands remain unmet; on the other, growth in the health industry lacks momentum. The theme of the 2024 Xipu Conference—“Moving Forward Under Pressure: Breaking and Establishing the Path from Stock to Incremental Growth”—sparked strong resonance across the industry upon its release.

Industry leaders from several top-tier institutions shared their perspectives on the theme. Qiu Huawei, Chairman of China Resources Sanjiu, a leading Chinese OTC enterprise, stated, “The existing market is a contest of efficiency.” Cheng Jie, President of Dong-E-E-Jiao, remarked, “Outstanding companies need to maintain strategic focus to win the future.” Tang Hui, Chairman of By-Health, a leading health supplement company, proposed, “Under pressure, manufacturers and distributors need to join forces rather than engage in zero-sum games.” Liu Qian, General Manager of the Omnichannel Business Unit at AstraZeneca China, noted, “Retail pharmacies can leverage their off-hospital advantages in manpower and outlet accessibility, collaborate with in-hospital services, provide professional services to chronic disease patients, and unlock significant growth potential.” Chen Hui, Vice President of Novartis Innovative Medicines China, also made a special appeal: “To achieve incremental growth, chain pharmacies must transform and upgrade from mere drug sellers to professional healthcare service providers.”

Several listed pharmaceutical retail chains expressed nearly identical views. Lan Bo, Chairman of Jianzhijia, stated, “Chinese pharmacies are facing the dual pressures of intense competition and consumption downgrading. The only way to break through is to gain insights into consumer trends, improve operational efficiency, and collaborate closely with upstream manufacturers.” Li Wenjie, Chairman of Shuyu Pingmin, issued a strong warning: “Relying on medical insurance for survival is a thing of the past; only by seizing consumer trends and creating value can there be a future.” Ruan Hongxian, Chairman of Yixintang, called for a shift in focus: “The era of high growth is gone forever; we must return to providing professional services to consumers.”

As the clear-cut industry faces immense pressure and urgently needs to break through and move forward, many entrepreneurs remain confident in incremental opportunities. Categories such as health supplements, traditional Chinese medicinal materials, medical devices, medical aesthetics, and personal care all represent areas of growth. Fosun International CEO Chen Qiyu further highlighted that the central nervous system, weight loss, and anti-aging are major high-growth sectors.

From the latest conference agenda just released by the Organizing Committee, we note that the topics of this year’s West China Pharmaceutical Conference are more forward-looking and leading-edge than in previous years.

According to the Organizing Committee of the Westphal Conference, this year’s agenda is designed with a stronger emphasis on forward-looking insights and professional expertise to meet the current needs of industrial transformation and upgrading. Starting from the macro trends of China’s health industry, the conference will focus on discussing how enterprises can identify new growth models amidst multiple challenges such as boosting resident consumption and population aging. The aim is to help the industry navigate the transition phase, seize present opportunities, and strategize for the future.

Where Exactly Lies the Current Industrial Growth? The Organizing Committee of the China Health Industry Conference (CHIC) Reveals That as Health Needs Become More Segmented and Category Structures Are Reshaped, Two Major Growth Markets—“Self-Pleasing Economy” and “Silver-Haired Economy”—Are Gradually Becoming Clear. While survival-oriented consumption is mired in fierce competition within a saturated stock market, growth-oriented consumption is witnessing burgeoning incremental competition. How can the “Self-Pleasing Economy” accelerate onto the fast track? And under the trend of deepening population aging, can the “Silver-Haired Economy” build a new-type market? The conference will focus on these core issues.

Looking ahead, where is the health industry headed? Reporters learned from the Organizing Committee of the China Health Industry Summit (CHIS) that this year’s event features several special summits, including the “Health Industry Foresight Forum,” “AI for Health,” and the “Young Entrepreneurs & Young Scientists Summit.” These forums bring together elite voices from around the world, offering insights from multiple perspectives such as global vision, industry-research synergy, and technological application.

In the future transformation of the health industry, science and technology are held in high expectation. Throughout millennia of human exploration into life sciences, the topics of “aging and disease” have been unavoidable. What are the cutting-edge global developments in life sciences, such as gene editing and RNA technologies? What are the future application scenarios for interdisciplinary fields like synthetic biology? How can basic research and applied research be effectively integrated? How can we reduce trial-and-error costs and accelerate the practical implementation of AI applications? These questions will all be answered at the conference.

As a long-established and prestigious conference in China’s health industry, the Xipu Conference has been held for 16 consecutive sessions. It is organized by Zhongkang Technology, a well-known digital technology company in the industry. The organizer’s robust data resources, leading technological and AI capabilities, professional industrial research expertise, and strong ability to link industrial resources serve as the core engine that has established the Xipu Conference as a bellwether for China’s health industry.

The conference advocates an industrial spirit of “responsibility and commitment,” dedicated to “leading industrial innovation and integration.” It has long been widely acclaimed for its forward-looking vision, participation by top-tier leaders, and strategic interactive value. Highly influential and commanding in China’s health industry, it is hailed as the Chinese counterpart to the J.P. Morgan Healthcare Conference.

This year’s West China Pharmaceutical Conference was meticulously planned, with its theme announcement and agenda design fully demonstrating profound insights into and a leading role in the future development of China’s health industry.

It is reported that this year’s Xipu Conference will invite leading domestic and international health industry manufacturers, mainstream commercial retail enterprises, domestic and foreign investment institutions, medical and health service providers, commercial insurers, digital technology companies, academicians from the Chinese Academy of Sciences and the Chinese Academy of Engineering, clinical experts, policy experts, industry experts, technical experts, entrepreneurs, scientists, and investors to attend. Distinguished guests, including renowned economists Guan Qingyou and Xiang Shuai, as well as Sun Tianshu, Tenured Professor and Distinguished Dean at Cheung Kong Graduate School of Business, will attend the conference and deliver keynote speeches.

The inaugural “Forward-Looking Forum on the Health Industry” will also invite leading domestic and international experts, including Peter Lobie, Fellow of the Royal Society Te Apārangi (Royal Society of New Zealand); Li Jinsong, Academician of the Chinese Academy of Sciences; and Lai Guan Ng, Senior Researcher at Renji Hospital, Shanghai Jiao Tong University School of Medicine, to share their insights. More than 60,000 industry elites are expected to attend, underscoring the urgent demand for breakthroughs amid the current intense pressures of industrial transformation and upgrading.